Bacterial polyketide biosynthetic processes provide a wide range of structurally diverse bioactive natural products used as immunosuppressants, antibiotics, antiparasitics, growth promotants, and anticancer agents. Tremendous advances in genetic and biochemical understanding of the polyketide synthases (PKSs) and related enzymes involved in these biosynthetic processes has ushered in a new era of drug discovery in which different components of the processes can be combined or altered in order to access novel natural products. An understanding of the unique enzymes, which both provide the unusual biosynthetic precursors used in these processes, and incorporate them into a polyketide product is critical to this effort. One such example is found in ansatriemn biosynthesis where coenzyme A activated cyclohexanecarboxylic acid (CHC-CoA) is generated from a shikimate pathway intermediate, and subsequently used to generate the final antifungal polyketide product. Combining five CHC-CoA biosynthetic genes from the ansatrienin biosynthesis gene cluster of Streptomyces collznus with the avermectin biosynthetic genes in an Streptomyces a vermitilis host, has resulted in an engineered strain that produces the commercial novel antiparastic agent doramectin (an avermectin analog generated using CHC-CoA as a biosynthetic precursor). In addition to antiparasitic and antifungal agents, CHC-CoA and related compounds are important precursors used in the biosynthesis of a group of polyketide-derived protein phosphatase II inhibitors, promising antitumor agents, as well as novel functionalized antibacterial agents. The long-term objective of this application is to use the CHC-CoA biosynthetic genes and a hybrid combinatorial biosynthetic approach to generate and ultimately test the biological activity of novel members of each of these different drug classes. This objective will be accomplished through four specific aims. 1) Determination of the rate-limiting step in CHC-CoA biosynthesis and biochemical characterization of the enzymes involved in the pathway. 2) Cloning and sequencing of the biosynthetic pathway genes for formation of CHC-CoA-derived phoslactomycins, members of the important class of antitumor protein phosphatase II inhibitors. 3) Generation of new antiparasitic and antibacterial agents by using the phoslactomycin and CHC-CoA biosynthetic genes as tools to generate bacterial hosts containing hybrid polyketide synthases and CHC-CoA pathway intermediates. 4) Generation of novel protein phosphatase II inhibitors, by manipulation and combinatorial biosynthesis of the phoslactomycin biosynthetic gene cluster.